Detsky Mir begins IPO, Sistema to maintain majority stake
MOSCOW. Jan 16 (Interfax) - AFK Sistema has announced plans to hold an initial public offering of shares (IPO) in children's goods retail subsidiary Detsky Mir.
Sistema, which will offer shares for sale in the IPO, plans to maintain a majority stake in Detsky Mir post-IPO, Sistema said in a statement.
The IPO will be held on the Moscow Exchange, a Sistema representative told Interfax.
Several other existing shareholders will offer shares for sale in the IPO, including the Russia-China investment Fund via Floette Holdings Limited and Exarzo Holdings Limited, as well as several Detsky Mir and Sistema executives.
Sistema plans to maintain strategic control over Detsky Mir operations in the medium term by maintaining a controlling stake in the retailer.
Following the IPO, the selling shareholders will be subject to a lockup of 365 days for company management and 180 days for other sellers.
Detsky Mir shares have been cleared for a Level 3 listing on the Moscow Exchange. The ticker symbol is DSKY.
The company has filed for transfer to a Level 1 listing following the IPO, should the free float meet the minimum requirement of 10%.
The joint global coordinators and bookrunners for the IPO are Credit Suisse, Goldman Sachs International and Morgan Stanley. Sberbank CIB and UBS are joint bookrunners.
The Financial Times quoted sources as saying 30% of shares would be offered in the IPO, while Sistema would maintain a stake of at least 50%.
The organizers will have an over-allotment option to sell up to 15% more shares than originally planned.
Detsky Mir had 525 stores in its chain as of the end of December, including 480 under the Detsky Mir brand (468 in Russia and 12 in Kazakhstan) and 45 in Russia under the ELC brand, with 596,000 square meters of total selling space.
